Written by Tom Furber, an AQA A-Level Economics tutor. | Published 20th August 2026.
Contents
Introduction
This page features full model answers for the AQA Economics A Level, Paper 1, 2024 past paper.
My tutor commentary on the answers is to be added over time.
The question paper containing the questions is available on the AQA website, linked here (external link to AQA).
Notes on the responses and how to use these model answers
- In the actual exam, you only have to attempt one of the two Section A questions. Here I have written model answers for both questions.
- Answers are likely to score full marks or close to this.
- I recommend having the question paper and answers up at the same time.
- Do not just copy answers. Instead, attempt the questions yourself without looking. Then compare your responses to the model answers, as well as using the mark scheme. For many questions, there are multiple ways to score highly.
- Answers are not to be copied without permission from the author.
- Some answers feature extra commentary or working from me. These are marked separately in “tutor’s commentary” boxes.
- I am not affiliated with any exam board. These model answers are written independently of the exam board.
Section A – First context
Question 1 (2 marks) – rent calculation
Tutor’s commentary on the 2 mark question
Make sure to include the units, in this case a % sign at the end of your answer.
Real means we are accounting for the effect of inflation.
To calculate the percentage change in real rent, practically we need to express all rents in terms of the same year’s prices. By doing this, we remove the general effect of inflation.
One way to calculate this is to first express 2021 rent in terms of the 2015 price level, to get the “real rent” in 2021.
Then we can calculate the percentage change in real rent from 2015 to 2021.
There are other approaches to this calculation to get the same result.
\[\text{2021 rent in 2015 prices} = \frac{169.35}{1.12}=151.205357…\]
\[\text{Percentage change in real rent} = \frac{151.205…-121.16}{121.16}\times 100 = 24.798… = \mathbf{24.8\%} (1dp)\]
Question 2 (4 marks) – students and accommodation data
Tutor commentary – exam technique for the 4 mark question.
For the 4 mark question, I would suggest giving two data comparisons. In this case, the change in number of full-time students and change in the amount of students in private rental accommodation.
For these data comparisons, make sure to include:
- What’s being measured. For example “the number of full-time students”.
- Units e.g. millions of students
- Time frame e.g. from 2015 to 2021.
It can also be helpful to calculate the change for one of you statistics.
Your answer then needs to link each comparison back to the question. For example, what it tells us about demand versus supply of university accommodation.
It is important to be concise on the 4 mark question and not to write a long essay here. Succinct, but complete, data comparisons and links to the question will help score here.
The number of full-time students has increased from 1.7 million in 2015 to 2.15 million in 2021, an increase of 0.45 million over the period, showing a large increase in demand for accommodation of about 450,000 students.
Meanwhile, the number of students in private rental accommodation has increased from about 650,000 in 2015 to 750,000 in 2021, an increase of only 0.1 million. The number of students in university rentals has not changed from 2015 to 2021. This suggests the increase in supply of university and private rental accommodation of 100,000 from 2015 and 2021, far less than the increase in demand.
Question 3 (9 marks) – effect of more students
Tutor commentary – going beyond the basic supply and demand.
For this 9 mark question of the effect of more students on the market for student accommodation, the initial effect is the shift right in demand. We can then think through the effect on the market equilibrium (higher price and higher quantity).
However, this would not give us enough to talk about on its own. So we want to go a little beyond this here to give our explanation more power.
Here I briefly explain a) parts of the price mechanism and b) the importance of the price elasticity of supply in determining the equilibrium effects.
For a 9 mark question, one way to structure your answer is as follows:
- One or two definitions.
- Explaining the diagram.
- Explaining the issue in words (or in this case, a related issue of the importance of the PES).
The last two can be combined or reversed as needed for the question.
Demand is the amount of a good or service that consumers are willing to pay. The price elasticity of supply refers to the responsiveness of supply to a change in price.
More students are going to university, with the number of full-time students at UK universities rising from about 1.7 million in 2015 to 2.15 million in 2021. This is likely to raise the demand for university places. This shifts demand right from D1 to D2 in the market for student accommodation in the diagram below. This means that at the original price p1, there is excess demand for the student accommodation. The price mechanism eliminates the excess demand. For instance, a rise in price rations the excess demand. Altogether the demand shift to the right leads to an increase in the price of student accommodation from p1 to p2 and an increase in the equilibrium quantity of student accommodation from q1 to q2.
Supply is likely to be price-inelastic for student accommodation. There may be shortages of land in some cities, making it harder to increase supply in response to a price rise. Therefore, following the demand shift to the right, the price is likely to increase significantly, so that supply meets demand. The equilibrium quantity only increases to a small extent owing to the inelastic PES.
Question 4 (25 marks) – student housing policies
Tutor commentary
For this 25 marker on policies to intervene in student housing, it can be useful to start off the introduction by defining the market failure. This makes it easier to explain some of the benefits of the subsidy policy later on in correcting the market failure.
My answer runs through two of the easier policies to explain: Subsidy and maximum price. Other policies can also work.
Here is a summary of the essay’s paragraphs:
- Intro: Explain the market failure.
- Analysis point 1 (A1): Subsidy + positive consumption externality diagram. Subsidy leads to welfare gain.
- Evaluation point 1 (E1): Time lag.
- A2: Maximum price and government failure.
- E2: Importance of PES.
- Conclusion: Subsidy more effective, can deliver a long-run return for the government. Subsidy could be combined with deregulation to circumvent the time lag problem.
Student accommodation can be considered a merit good, underconsumed in the free market. There are positive external benefit benefits to providing student accommodation, such as enabling lower incomes students to afford going to university, boosting human capital and productivity. This benefits firms who can lower their costs by having more productive workers. The free market may not take into account these external benefits, which could justify government intervention.
Subsidies could be given to builders of student accommodation which could raise the supply of student housing. The positive consumption externality of student accommodation means MSB > MPB. without a subsidy the free market produces at point E where MPB = MPC. Yet the socially optimal outcome is at quantity q1 and price p1 where MSB = MSc. The underconsumption of student housing of q1-q can be corrected by the subsidy, which shifts supply/MPC right from MPC=MSC to MPC with subsidy. This increases the quantity of student accommodation from q to q1, increasing social welfare as the socially optimal quantity of student housing is now being produced and consumed. The welfare loss due to the market failure of EAB is now a welfare gain due to the subsidy correcting the market failure. Moreover the subsidy causes a fall in rents for students from p to p2. This increases consumer surplus and makes student housing more affordable to those whose families may not be able to support them with rent payments. This could encourage those on low incomes to apply to university as a result and reduce the proportion of their income spent on rent from ¾ in London to a more manageable proportion.
However, there may be a time lag before the student house-building subsidy has an impact. Even after the subsidy, it can take time for housebuilders to build extra homes for students, both in the time spent building but also the paperwork required to meet planning restrictions. As a result, there could be many years of delay before the supply of student housing actually increases after the subsidy. So rent prices may not fall for some time, so the market failure remains.
If you are looking for tutoring to help you improve your 25 mark essays, please check out my A-Level Economics tutoring page.
Another policy that could be used is a maximum rent such as a maximum percentage increase in rents in Scotland for university accommodation. This reduces the price of student housing from p1 to p2 in the market for rental property shown below. While this could make student housing more affordable for students, it could also lead to government failure. The maximum price leads to an extension in demand from q1 to q2, while there is a contraction in the supply of student housing from q1 to q3. This leads to excess demand of (q2-q3). This means there may be queues to find student accommodation and even fewer students would be able to find housing, compared to the free market outcome. So social welfare may fall by the shaded area, representing government failure. Landlords, making less profit from renting properties, may also invest less in property maintenance. This could lead to lower quality accommodation, reducing the utility of accommodation for students, making the students as consumers worse off.
However, this depends on the price elasticity of supply of housing. The PES is likely to be inelastic, because of difficulties in sourcing raw materials for building homes and a lack of land in some cities, making it more difficult to increase supply in response to a price rise. So, following a maximum price, the excess demand created may only be limited, with the supply of rental properties not falling as much. Therefore the government failure from the maximum rent may be limited in the short term.
Overall the house building subsidy is likely to be the most effective policy to intervene in the housing market. The subsidy increases supply which leads to a lower price of student accommodation, increasing consumer and producer surplus. However the rent control may have mixed effects even for students as consumers, with some consumers no longer able to find housing due to the risk of some landlords withdrawing from the student accommodation market. While there could be a time lag associated with a subsidy before it has an impact, this could be combined with housing market deregulation to make it easier for firms to use the subsidy money to get building more quickly. Subsidies do have an opportunity cost in that the government may forgo spending on other items such as healthcare. However it could be argued that subsidising student accommodation could be partially or fully self-funding for the government in the long run. By making it more affordable to go to university, more students may go to university, learning more skills, which increases productivity, labour demand and future wages. This could increase income tax revenue for the government over time.
Section A – Second context
Question 5 (2 marks) – trade union density calculations
\[\text{mean for private sector} = \frac{18.4+16.6+14.2+13.4+12.8}{5}=\frac{75.4}{5}=15.08\%\]
\[\text{mean for public sector} = \frac{59.7+58.7+56.6+52.8+50.1}{5}=\frac{277.9}{5}=55.58\%\]
\[\text{difference} = 55.58 – 15.08 = \mathbf{40.5} \textbf{ percentage points}\]
Question 6 (4 marks) – private versus public sector data
Average annual nominal earnings for the private sector increased by about 2.2% in the year to January 2015 but only about 0.6% (1.6 percentage points lower) for the private sector. Similarly average annual nominal earnings increased by about 7% for the private sector in the year to September 2022, compared with only about 3% for the public sector (4 percentage points lower). This suggests earnings are growing more slowly in the public sector.
This suggests private sector workers saw a greater increase in their ability to afford goods and services over the same period, meaning private sector workers can afford even more necessities and luxuries than public sector workers. So private sector workers’ living standards rise more quickly than public sector workers from 2015 onwards.
Question 7 (9 marks) – excess demand for labour and the wage
A shortage of labour means labour demand exceeds labour supply at the current wage. Labour demand is the amount of workers firms are willing and able to hire at a given wage rate.
Construction and hospitality sectors faced some of the most severe labour shortages. In the diagram at wage w1, there is excess demand for labour of (q2-q1) for labour demand curve DL and supply of labour SL. The wage mechanism steps in to eliminate the shortage of labour. The rationing function means the wage rises to eliminate the excess demand. The rising wage leads to an extension in labour supply (incentive function) due to a higher economic return from working, increasing the incentive to work. This leads to the elimination of excess demand for labour, so SL=DL at q3, while the wage rises from w1 to w2. This could partly explain annual pay growth of 6.6% in the private sector in the year to September 2022, as wages rise to eliminate labour shortages.
The extent to which wages rise depends on the wage elasticity of demand (WED) for labour. In hospitality, waiting staff may be replaced by self-order systems or QR code technology for ordering, meaning there are substitutes to labour. So the WED may be elastic at DL1. So, only a smaller increase in wage from w1 to w3 is required to ration away all the excess demand for labour, as a larger proportion of firms switch to using capital instead to take orders, with labour demand falling from q2 to q4. So labour shortages may only lead to limited wage rises if the WED is elastic.
Question 8 (25 marks) – trade unions
Tutor commentary – the exam technique I share with my tuition students
Writing trade union and minimum wage essays
For trade union and minimum wage essays, there are often two key diagrams around which to base many of your essays:
- Trade union / minimum wage in a perfectly competitive labour market (see analysis point 1).
- Trade union / minimum wage in a monopsony (see analysis point 2).
Other ideas are possible. For example the extracts mention the benefits of trade unions for worker training, an often overlooked aspect of trade unions.
Subject to the essay title, you can often base these types of essays around these key diagrams. You should always adapt your points and explanations to the specific question of course.
How to evaluate trade unions
Some students have trouble generating evaluation points for trade union essays. Here are a few ideas that I use in this essay. This is essentially a detailed essay plan:
- Analysis point 1: trade unions in a perfectly competitive labour market may lead to unemployment
- Evaluation 1: this depends on the wage elasticity of demand for labour (WED).
- Analysis point 2: trade unions in a monopsony may lead to an increase in employment.
- Evaluation 2: this depends on the percentage of workers in the industry that are in a trade union. Note this is known as “trade union density“.
- Other evaluation points that I mention or use as justifications in the conclusion
- Depends on how strictly trade union activity is regulated.
- The increasing importance of monopsony power in the economy, given the rise of the gig economy for instance.
- Using the history of trade unions in achieving improved workers’ rights as evidence of their benefits.
Of course you could also use other evaluation points to argue the other way.
For one-to-one help on improving your economics essays for labour markets, please check out my economics tutoring!
A trade union is a group of workers bargaining collectively to improve outcomes for workers. Protecting the interests of workers could include increasing wages and employment, as well as improving working conditions.
In a perfectly competitive labour market, trade union activity could increase the unemployment rate, with the extract claiming that strikes by transport workers may lead to less efficient labour markets. Trade union workers may decide to work for a minimum hourly wage wTU in the diagram, otherwise if paid below this, the workers will go on strike. This could occur in local authorities or in some private sector employers. This increase in wage from w1 (where labour supply meets labour demand) to wTU due to the trade union increases labour supply from q1 to q3 through an extension, as there is a greater incentive to enter the labour force. At the same time the higher wage increases the cost to firms of hiring workers, resulting in a contraction in labour demand from q1 to q2. Altogether this means the trade union increases the number of unemployed workers by (q3-q2), reducing total worker pay from q1w1 to q2wTU.
However, this depends on the wage elasticity of demand (WED) for labour. In some sectors, such as construction, workers may be a necessity for firms to build e.g. for bricklaying or plastering. As a result, even if trade union workers only work for wage wTU or higher, demand for labour may not fall as much. This reduces the extent of the increase in unemployment, and the total wages paid to workers may even rise. So, if WED is inelastic, workers may not be worse off from trade union activity.
Trade unions could improve labour market outcomes in monopsonist labour markets. This could include the market for nurses, where the NHS is the dominant employer. This could also apply more broadly to the public sector, including teachers and police officers, who may be striking to reduce the record gap between private and public sector pay. While in a perfectly competitive labour market, labour supply equals labour demand, so the equilibrium outcome is (q1, w1). The monoponist NHS could use its bargaining power to lower nurses’ wages to w2 by reducing employment to q2. Yet the trade union could decide to set wTU, the lowest wage at which workers will work, at w1. This changes the marginal and average cost of labour for employment levels q1 and lower to MCL1 and SL1 respectively, to be constant at w1. This firm now demands more labour, with employment increasing from q2 to q1 and wage increasing from w2 to wTU. The total wage payment to workers increases from q2w2 to q1wTU due to the trade union. This is because the NHS can no longer benefit from lowering nurses’ wages by reducing employment. This increases social welfare by the shaded area as the market is now operating at the allocatively efficient outcome where SL=DL, driven by the increase in worker welfare.
However, this depends on trade union density. While 50.1% of workers in the public sector may be part of a trade union in 2021, this has fallen over 9 percentage points since 2001. At the same time, only 12.8% of private sector workers are members of a trade union as of 2021. Low trade union membership makes it harder for workers to bargain collectively, as firms find it easier to hire workers from outside the union. So workers may see less of a rise in wages and employment from being part of a trade union, especially for private sector workers in monopsonistic labour markets, such as food delivery drivers. So trade unions need to have enough representation among workers to be effective in increasing worker pay.
Overall, trade unions are likely to improve the operation of labour markets. Monopsonistic labour markets are a significant and growing proportion of all labour markets, because of the government’s monopsony over the public sector, and the influence of multinationals or tech giants creating local or gig-economy monopsonies in the private sector. Therefore trade union action is more likely to increase wages and employment, than to decrease them. Indeed, history suggests British trade unions have been successful in campaigns to improve outcomes for workers, including a minimum wage, holiday and sick pay, maternity and paternity rights. The success of trade unions does depend on the state of trade union regulations. If trade union strike activity is made more difficult, e.g. by increasing the threshold for workers to vote for strike activity, then trade unions may not be able to strike as frequently in monopsonies, so wages and employment may only increase to a limited extent.
Frequently asked questions
How should I allocate my time for Section A?
You should aim to spend 1 hour, or half your alloted time for Paper 1, on Section A.
You may have to spend 15-30 seconds choosing which context to answer. I recommend practising at choosing quickly if you sometimes take longer.
2 marker: 2-3 minutes.
4 marker: 5-6 minutes.
9 marker: 13 minutes, including finding the relevant section of the extract and briefly reading for a relevant fact.
25 marker: The remaining time in the hour, so about 38-40 minutes minutes This includes time spent looking for relevant extract points.
There are other ways to manage your time to score highly. This is just one way.
How can I write enough in the time available?
If you are struggling to write enough in the time, this could be for lots of reasons:
- Lack of exam practice – not knowing the key points and plans for different topics. This means more time is required to generate an essay plan or come up with points.
- Slow essay writing – speed practice matters.
- Misallocated effort – writing too much in the wrong places.
The answers written above are “ideal” answers. While I have generally written these answers above in timed conditions, they are at the edge of what might be possible for a fast-writing student. So, do consider where you might save time in 25 markers. A shorter second analysis paragraph, a shorter introduction or a shorter conclusion could be possible.
So for those struggling with time, you should consider whether you are spending too much time in a certain question. For example, are you spending more than 13 minutes on the 9 mark question? This is one place where some students spend far too much time relative to the marks available.
What are the most common mistakes in Section A for AQA Economics?
1) Question-specific mistakes such as analysis / evaluation / diagram / essay structure errors that are not specific to Section A.
2) Time misallocation. Too much time to reading the extract, long essay plans or spending over 13 minutes on the 9 mark question.
3) Not using the extracts (sufficiently). Especially for the 9 and 25 mark questions.
How should I use the extracts for Section A?
I would generally avoid spending 10 minutes at the start of the exam reading extracts. Not only is this far too long, but it’s also unguided. You need to have the questions in mind.
If you do want to get an overview of the extracts, a skim-reading is of course reasonable.
Instead, I would look at each part of the extract as you need it by question.
For example:
- 2 mark and 4 mark question: Focus on data parts of the extract.
- 9 mark question: Read the question, then find a relevant quote from the extract to support
- 25 mark question: Read the question, then find a few key quotes to support your points. Also, you can use quotes or data that you used earlier on to speed things up.
This question-led reading of the extracts can often be more efficient than a general undirected reading.
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